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Index IDEA: A tale of 16 markets

November 29, 2017

When viewed from the eyes of an astronaut, the world may look very similar from country-to-county, continent-to-continent. And, similarly, when viewed through the lens of a broad global or regional index, individual countries may lose some of their distinct characteristics.

To help illustrate this point, FTSE Russell recently examined 16 of its single country indexes and two of its broad global and regional indexes to get a better sense for how individual markets compare to each other and to their broad benchmark. FTSE Russell examined price-to-equity, price-to-book, price-to-sales and dividend yield:

Alec Young, managing director, investment strategist, FTSE Russell:

“Country equity fundamentals vary widely across Developed and Emerging markets. As such, access to country level exposure allows investors to surgically target desired fundamental attributes such as dividend yield or valuation.”

Patrick O’Connor, head of global ETFs for Franklin Templeton Investments:

“The goal of our new collaboration with FTSE Russell is to provide investors with the ability to gain access to a diversified set of efficient non-US market exposures through our new series of index-based ETFs.”

This analysis was gathered from 18 new indexes measuring performance of 16 individual and two global regions based on the FTSE All-World® Index Series. These indexes underlie a new series of ETFs from Franklin Templeton.

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All information is provided for information purposes only. Every effort is made to ensure that all information given in this publication is accurate, but no responsibility or liability can be accepted by any member of the LSE Group nor their respective directors, officers, employees, partners or licensors for any errors or for any loss from use of this publication or any of the information or data contained herein.

Views expressed by Alec Young of FTSE Russell and Patrick O’Connor of Franklin-Templeton Investments are as of November 29th and subject to change. These views do not necessarily reflect the opinion of FTSE Russell or the LSE Group.

No member of the LSE Group nor their respective directors, officers, employees, partners or licensors make any claim, prediction, warranty or representation whatsoever, expressly or impliedly, either as to the results to be obtained from the use of the FTSE Russell Indexes or the fitness or suitability of the indexes for any particular purpose to which they might be put.

No member of the LSE Group nor their respective directors, officers, employees, partners or licensors provide investment advice and nothing in this IDEA should be taken as constituting financial or investment advice. No member of the LSE Group nor their respective directors, officers, employees, partners or licensors make any representation regarding the advisability of investing in any asset. A decision to invest in any such asset should not be made in reliance on any information herein. Indexes cannot be invested in directly. Inclusion of an asset in an index is not a recommendation to buy, sell or hold that asset. The general information contained in this publication should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional.

No part of this information may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission of the applicable member of the LSE Group. Use and distribution of the LSE Group index data and the use of their data to create financial products require a licence from FTSE, Russell, FTSE TMX, MTSNext and/or their respective licensors.

Past performance is no guarantee of future results. Charts and graphs are provided for illustrative purposes only. Index returns shown may not represent the results of the actual trading of investable assets. Certain returns shown may reflect back-tested performance. All performance presented prior to the index inception date is back-tested performance. Back-tested performance is not actual performance, but is hypothetical. The back-test calculations are based on the same methodology that was in effect when the index was officially launched. However, back- tested data may reflect the application of the index methodology with the benefit of hindsight, and the historic calculations of an index may change from month to month based on revisions to the underlying economic data used in the calculation of the index.

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